Innovation Conversations with Scott Anthony

I had the opportunity recently to interview Scott Anthony, President of Innosight and the author of "The Silver Lining" about a variety of innovation topics including: 'The Great Disruption', barriers to innovation, education, leadership, and commodity businesses.

Here is the text from the interview:

1. What is the biggest challenge that companies face in the Great Disruption?

I think the biggest challenge facing companies is an unwillingness to let go of the past. Companies have to come to grips with the fact that what made them great in the past will not make them great in the future. That doesn't mean they have to completely walk away from their heritage. But they to constantly question the status quo, think about the businesses they are not in that they should be, and be willing to walk away from businesses before they need to. It's a tough challenge.

2. What stands in the way of many companies being able to deliver new innovations to market?

Well, I think it is important to note that companies don't struggle with all types of innovations. Most companies excel at managing innovations that extend their core business. They struggle with innovations that run counter to their existing way of operating. Then, the greatest enemy lies within. We call it "the sucking sound of the core." A company's core systems and structures "want" an innovation to conform to what a company has done before, not what is necessary for success. The sucking sound makes innovation slow and complicated. To break the sucking sound of the core, companies need to make sure they have a "safe space" for innovation, and that senior leaders actively step in to break standard operating procedures when required.

3. If you were to change one thing about our educational system to better prepare students to contribute in the workforce of the Great Disruption, what would it be?

The one thing I would want to see students trained in is non-linear thinking. The era of optimization is over. We are in an era of constant creative destruction. Students need to learn how to find the non-obvious insight and to imagine possibilities that don't yet exist. I worry that an increased focus on standardized tests runs counter to the needs increasingly facing companies.

4. What skills do you believe that managers need to acquire to succeed in the Great Disruption?

The basic problem facing many managers is they are being asked to solve problems they have never faced before. You see, it used to be possible to have a productive 40-year career being an operator that did a great job executing a solidly formulated strategy. Today's leaders have to be great operators and great innovators. They have to pass that old F. Scott Fitzgerald test of holding two opposed ideas in the mind at the same time, while still retaining the ability to function. In simple terms, managers have to learn how to find the "and." Disciplined and creative. Love big businesses and small businesses. And so on.

5. What advice do you have for companies that are already loving the low end in a commodity business?

Companies that are already loving the low-end should think about innovative ways to extend and grow their business. One way to do so is to add on additional offerings that help customers solve additional problems they are facing in their lives. This could be a new feature, it could be a service. Another approach is to see if there are other markets where they can bring their low-cost acumen. A low-cost business model is a powerful weapon that companies can deploy in multiple markets.


As a special bonus, here is a video of Scott Anthony being interviewed about "The Silver Lining" by Business Innovation Factory's Chris Flanagan:





My book review of "The Silver Lining" can be found here.

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Braden Kelley is the editor of Blogging Innovation and founder of Business Strategy Innovation, a consultancy focusing on innovation and marketing strategy. Braden is also @innovate on Twitter.

Book Review - "The Silver Lining" by Scott Anthony

A couple of weeks ago I received "The Silver Lining" by Scott Anthony in the mail. "The Silver Lining" is a relatively short, easy, and pleasant read. Scott introduces several different concepts in the book in addition to the main thesis - which seems to be that companies must prune their innovation portfolios, refeature their products to meet ever-changing customer requirements, and re-tool their organizations to better deal with the constant change that is becoming the norm in the world today.

The first concept that Scott introduces is a term to refer to the current economic dis-equilibrium - 'The Great Disruption' - and the rapid change that organizations face. Here is a great quote from the first chapter:

• "The biggest silver lining for innovation is that the scarcity that is sure to result from the current economic climate is actually a good thing for innovation. Abundance is actually the root cause of many corporate struggles with innovation."

Another key focus of the book is detailing the importance of pruning your innovation portfolio. This a great analogy for re-evaluating your innovation investments, as often in cutting back selected branches you make the overall plant or tree healthier and allow it to grow stronger upwards. With innovation portfolios it is the same. Often many organizations allow too many projects to continue consuming resources that should really be 'pruned' so that those project resources can be re-deployed to help the remaining projects become more successful and complete faster.

At the same time, Scott Anthony makes the point that opportunities may exist for organizations to refeature products in ways that both reduces costs and increases sales. Pursuing this strategy can also reduce options available to potential disruptive competitors seeking to enter the market.

Smart companies will also use 'The Great Disruption' as an opportunity to re-tool their innovation capabilities and processes while also utilizing their potentially reduced innovation budget to conduct smart strategic experiments that could include exploring open innovation or low end opportunities ('learning to love the low end').

After describing how to love the low end (which is very similar to how companies should approach any disruptive innovation), Scott Anthony concludes the book with his thoughts on personal reinvention and his views on what's next for innovation.

Another favorite quote from the book (which I've heard elsewhere) suggests that you should staff up a disruptive innovation project or a strategic experiment with the best people you can find for each element (not the people that have been successful in the mainline business):

• "Good entrepreneurs don't take risk, they manage risk."

Overall, Scott makes some good points about pruning the innovation portfolio, retooling the organization for better innovation success, and addressing the low end of the market that make the book a worthwhile read.


My interview with "The Silver Lining" author Scott Anthony can be found here.

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Braden Kelley is the editor of Blogging Innovation and founder of Business Strategy Innovation, a consultancy focusing on innovation and marketing strategy. Braden is also @innovate on Twitter.